In short: Mortgage rates moved sharply higher over the past month, with the daily 30-year rate reaching 6.75% at one point, a nine-month high. The move reflects a string of inflation-related pressures: elevated energy prices, hotter-than-expected April consumer and producer price readings, and renewed questions about the Fed’s rate path.

Mortgage rates move higher

The borrowing environment has gotten tougher for home shoppers over the past month. The daily 30-year mortgage rate climbed as high as 6.75%, its highest level in nine months.

The increase came amid a series of inflationary surprises. Energy prices remain elevated, continuing inflation concerns. Both consumer and producer prices rose more than expected in April. Energy prices and tariffs contributed to the increase, but shelter inflation was also higher than expected, even as market rents have been cooling.

With inflation looking stickier and the labor market more stable than expected, markets are repricing the likely path of Fed policy, pushing interest rates higher. Minutes from Jerome Powell’s final meeting as Fed chair showed that “many” officials favored removing language suggesting the next Fed move was more likely to be a cut than a hike.

What’s the impact on housing?

Higher mortgage rates have eroded some of the recent affordability improvements shoppers enjoyed when income growth outpaced home value appreciation and rates hovered closer to 6%. As a result, the spring market rebound anticipated heading into 2026 appears much more muted.

Despite this recent setback, the broader market dynamics have not entirely reversed. Affordability, available listing options, and negotiating power all remain more favorable for buyers today than they were at this time last year.